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COVID-19 – The Continuing Battle

21/10/2020

In recent HaesCooper blog posts, we have focused on the fiscal and financial implications business owners are battling as a result of the COVID-19 pandemic. Sadly, it looks like the second wave of COVID-19 is with us – especially for those who live in Northern England.

Given this, we will continue to share advice and information related to COVID-19 and the impact it is having on UK businesses. As part of this, we will explore the Government’s recently announced continuing financial support for UK businesses in local lockdown areas.

Government Support for UK Businesses

Chancellor Sunak recently announced the Job Support Scheme (JSS) to protect jobs in businesses that are facing lower demand over the winter months as a result of COVID-19. All employers with a UK bank account and PAYE schemes can claim the grant, but large businesses will first need to meet a financial test to ensure their turnover is lower the pre-COVID-19. There is no financial assessment test for small and medium enterprises (SMEs). HMRC has published a JSS factsheet, with examples.

The JSS Government grant covers one-third of an employee’s hourly wage, for every hour not worked – with a cap of £697.92 per month. The JSS starts on 1 November 2020, with grants payable one month in arrears. Businesses can make claims through Gov.UK from December 2020.

Job Support Scheme Expansion for Closed Business Premises

The JSS has been extended to provide temporary support to those UK businesses that are legally required to be closed by restrictions imposed by one of the four Governments in the UK, not Local Authorities. This is known as the Job Support Scheme Expansion for Closed Business Premises and starts from 1 November 2020, for 6 months, with a Government review in January 2021. The UK Government has published a PDF called the ‘Job Support Scheme Expansions for Closed Business Premises’.

The JSS Expansion for Closed Businesses is available to employers with a UK bank account and PAYE schemes registered on or before 23 September 2020, and if that employer’s business has had to close for a minimum of 7 consecutive days as a result of a Government-imposed local lockdown.

The grant would pay for the employee who cannot work for that employer – and would pay for two-thirds of the employee’s normal wage to a limit of £2,100 per month. The grant does not cover Class 1 employer NIC or pension contributions.

Employee Redundancy

Employees cannot be made redundant during the period in which the employer is claiming a grant.

There are the usual payback provisions if HMRC checks show that the above JSS claims have been made incorrectly or fraudulently. Furthermore, the names of the employers claiming under the JSS Expansion for Closed Business Premises will be published so that their employees can find out if their employer has claimed for them under the scheme.

If you require support in accessing schemes – or would like to discuss how we can help your business through challenges caused by COVID-19, contact us.